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2026-05-27 20:40:07
[Brazil's Inflation Surpasses Target Upper Limit, Reaching 4.64%; Food and Housing Prices Rise in Succession; Lula's Aid Package and High Interest Rates Engage in a Tug-of-War] ⑴ Brazil's inflation accelerated more rapidly than expected in the first half of May. Official data showed that consumer prices rose 0.62% month-on-month, higher than analysts' expectations of 0.57%. The annualized inflation rate rose to 4.64%, exceeding the 3% target set by the Central Bank of Brazil and its upper limit of plus or minus 1.5 percentage points. ⑵ Rising food and housing prices are the main driving force. Brazilian President Lula is working to alleviate the pressure from the energy shock caused by the war with Iran and has launched a series of social aid measures ahead of his re-election campaign in October. ⑶ Although borrowing costs remain high, these aid measures have effectively replenished household budgets and boosted the economy, while also complicating the Brazilian authorities' efforts to curb inflation.
